Power Rector Revival: Myth or Reality
By Obinna Ezeobi
 13th NOV 2006

Among the plethora of challenges hindering the growth of businesses in Nigeria, epileptic nature of power supply takes the top spot.

Many businesses in Nigeria have closed shop in the face of the collapse of the public power sector and high cost of providing alternatives, such as generators.

Aside from hampering the growth of business, the prostrate state of power has also reduced the quality of life of Nigerians, who have to cope with the frustrations of an erratic power supply amid the existing huge potential for power generation.

Despite the huge funds so far injected into the power sector by the President Olusegun Obasanjo administration since its inception in 1999 and the shuffling of ministers overseeing the sector, the situation is yet to improve and it is a wonder if the day will ever come when Nigerians, like Ghanaians three years back, celebrated one year of uninterrupted power supply.

While inspecting the Gerugu Power Plant in Kogi State and the gas plant at Ajaokuta last week, Minister of Power and Steel, Senator Liyel Imoke insisted that the energy sector would be completely revitalised by 2008.

He hinged his confidence on the 10 power stations undergoing construction at various parts of the country which when inaugurated between the end of 2007 and early 2008, would deliver additional 4,500 megawatts of power, thereby transforming electricity supply in Nigeria.

He said, beyond the 10, the Akwa Ibom State Government is working on one. In addition, the Rivers State Government will commission its Omuku Power Project by the end of this year. When Shell completes its Afam project, it will deliver 660 megawatts. There is Agip, which is working on its phase two. From there, we are expecting 450 megawatts. Then the Ibom Power will deliver 188 megawatts.

When we talk about 10,000 megawatts, we are very confident. Beyond the 10,000 megawatts, there is Mambilla, but unfortunately, it has a long gestation period of about six years. It is in two phases, when completed, it will give us 2,600 megawatts.

We are now looking at Geregu to get it going, so that we can build up on capacity. It is important that we do not get to 10,000 megawatts and stop. By 2010, our target is to have a minimum of 15,000 megawatts and we intend to build on it. We hope subsequent administrations will not make the mistake previous governments made and will also understand the need to invest in new generations.”

Besides, the minister said the impact of the independent power companies, who had been given licences would soon be felt.

In the next two to four years, we would see these companies producing and feeding into the national grid.”

Imokes optimism sounded like the usual rhetoric of government officials, but the advanced stage of the 195m euro-plant and the assurance of Siemens, the German company handling the project, lent credence to his statements.

Having been on site for 20 months, the Managing Director, Siemens Nigeria, Mr. Klaus Peter Gilbert, promised that the project would be ready for inauguration by the end of the year.

The next in line, according to the minister, will be the plants at Omotosho and Kpakpalanto, which are financed by Chinese loans, with the Federal Government providing 35 per cent counterpart funding.

But completing the job on time is not the main challenge facing the Geregu plant. Rather, it is getting uninterrupted supply of gas, needed to power the plant.

According to Imoke, the vandalisation of the gas pipelines in the Niger Delta, impairs the supply of gas to power plants.

He appealed to youths to stop taking out their grievances on gas pipelines as it affected all Nigerians, especially the poor, who cannot afford generators.

There is no denying that government has embarked on integrated efforts towards fixing the endemic power problem and reforming the sector, part of which includes the unbundling of the former National Electric Power Authority. But why leave it for the last lap of an eight-year term?

The gestation period for most of the projects are slated for 2008 and beyond, and by time the present administration would have left office, there will be a real risk of the projects running into hitches no matter how advanced work might be.

The new administration may abandon the projects, refuse to pay the contractors, upturn the reforms or even probe the executors.

But the minister claimed some guarantees are in place. For the last set of the power stations, letters of credit for the full value had been opened. So the contractors can draw on them, based on progress of work. That will guarantee that the projects will be delivered on time”, he said.

However, what Nigerians expect at this time is for the regulatory issues including tariff structure that will govern a privatised power sector to be put in place to stimulate further investments in power generation and distribution.

Nigerians are bored with tales of billions on naira being spent on the power sector without commensurate results in terms of output.

The right incentives, including concessions to prospective and existing investors must be given to end the nightmare in the shortest possible period

Back to Top
Post Your Feedback